It’s great that you’re revisiting your strategy and adapting it based on insights from tools like Product Research. The discrepancy between your traditional sell-through rate calculation and eBay’s formula reflects different perspectives on market performance. Here are some considerations and tips as you refine your approach:
Understand the Different STR Formulas
Your original method (sold divided by active) provides a clear snapshot of current competition versus demand, which is excellent for real-time decision-making. eBay’s formula, which divides sold by (sold + unsold + active), accounts for a broader historical context, which can be helpful for assessing market saturation and longer-term viability.
Identify Niche Opportunities
The example of the women’s tops highlights the importance of looking beyond STR for specific categories. If an item has consistent sales over time (even with a low STR), it could still be worth sourcing, especially if the average days-to-sell and profitability are acceptable.
Incorporate Additional Metrics
Consider blending STR with other factors to make a more nuanced decision:
Average Days to Sell: Helps you understand how quickly your investment turns into profit.
Profit Margins: A low STR item with high margins might still be a good buy.
Price Consistency: Stable prices over time suggest reliable demand.
Segment by Category or Brand
Certain items or brands behave differently in the marketplace. You might develop unique thresholds for STR or other metrics depending on the category. For example, women’s tops may have a lower STR threshold compared to electronics or collectibles.
Weight Historical Sales Data
Incorporate historical sales data to adjust for seasonality or long-tail opportunities. Items with sporadic but high-value sales could skew your traditional STR calculations but might be worth listing if storage costs are minimal.
Test and Iterate
Use small test batches to see how new metrics influence your buying and pricing decisions. For example, if a low-STR item sells reliably within 90 days at a decent margin, consider expanding your stock in that niche.
Balance Speed with Profit
Your original method focused on faster-selling items, which is ideal for turnover. If you’re expanding into categories with slower sell-through rates, ensure the pricing and profit margins justify the longer wait.
By combining the insights from Product Research with your historical STR strategy, you can develop a more flexible, category-specific approach that captures hidden opportunities without straying too far from your core efficiency principles. Let me know if you'd like help formulating a detailed decision-making framework!
